THE EU – HAS NO PLAN “B” –
The EU currency and political-economic system are a treaty contractual agreement. The agreement is breaking down as the British exit the EU system. The party controlling ITALY Politics is massively ahead in the polls for next year’s election – and they wish to LEAVE THE EU entirely. Italy the worst of the debt nations with banks that are truly bankrupted, are on life support. Fitch this weekend AGAIN downgraded Italy Credit Ranking – to a low government level of BBB which means borrowing and refinancing costs for the massive debt – 100’s of times more than Italy makes annually – will now rise and rise when they are broke. This makes Italy avoiding a default or bank failure problematic. Italy will leave the EU.
All eyes are on France Sunday as the massive 80 million vote to determine will France stay in the EU. If France goes out of the EU and Italy goes out of the EU ( for sure based on voter polls today ) there is NO viable economic EU. The EU currency becomes worthless in effect. The reconstitution of economics will take time and present the world system with challenges.
The stability of the EU has moved from economic super high risk to geopolitical higher risks.
Sunday North Korea threatened that they WILL WIPE OUT THE US AIRCRAFT CARRIER AND ARMADA with a single strike. While these crazy brains make their wild insane asylum statements it is not lost on them – that such a strike – delivers in less than 30 minutes – the end of North Korea as a viable space for life on the planet – from American Subs all focused wipe out powers upon North Korea. Weapons the world has never seen and is unaware exist with their Super Powers. The military in North Korea is not insane and those leaders who control power money and the toys – will in the end – be a little reluctant to have the crazy brains commit 30 minute suicide in a General MAD DOG MATHIS world – you can count on Trump to take no pause in reaction to any attack on America. North Korea simply ceases to exist with such a crazy brain move and the world knows THAT and so does North Korea.
So the talk from North Korea – has no effect – and is an age where CRAZY TALK is over. Their insane idea of themselves is about to be challenged by the leading SUPER POWER Of the world and their entire people’s survival is at risk from their crazy brain choices. Crazy brains can no longer be allowed to hold powers in today’s shrinking world of collaboration.
Those who cooperate and collaborate prosper – those who compete will perish.
That is the new mental software.
So geopolitically and economically all eyes on our PARIS. Today’s election will effect next week’s markets. We are seeing next week the following:
- GREAT NEWS & HUGE SURPRISE – Greek Leadership beat all expert expectations on growth and came in double the growth anyone expected to make a SURPLUS in 2016. They won. It’s a huge win. Now the IMF noting the new EU accounting standards were applied and the outcome is STUNNING – is this outcome sustainable. That is the next expert review before the July 6 billion loan repayment made possible only by the next huge bailout as Greece does not have the money to pay its bills still.
- The USA may close down if congress does not pass emergency spending legislation. Will they? There is no long term approved USA budget as required by Law from last September. Can the nation keep going on emergency temporary legislation and what does all that do to the American credit rating?
- Tax and Health Care bills are in process but the effects of both are likely to come much later than Trump desires if at all – and may derail further putting any result from TRUMP to the market space off till 2018 at the earliest. No TRUMP result to market profits and dynamics is likely in 2017 that anyone can see today.
- The TRUMP effect on the market IS chilling.
- The markets have been assessing RISK including OIL which despite enormous pressure to jaw bone prices up – the SURPLUS or oversupply is here to stay as we have reported – and oil dropped again last week also as we reported against the experts saying it was going to 60 dollars when it touched 49.00 dollars in fact.
The market is volatile.
The market is subject not to economics now but to geopolitical events affecting core trade and balance of market shares.
The world is in a TRADE WAR.
The Trade war is digital and ongoing.
Every nation is in the TRADE WAR for their own GNP result.
Trading agreements are being revised. Like the wind.
TIT for TAT tariffs taxes fines and penalties are being evoked nation to nation including bans on products ( to protect internal local suppliers ) over free and open trade. The IMF dropped its opposition to protection language in the FINANCE MINISTER final report to accommodate a more “intention to cooperate versus compete ” tone. The leadership agreed to stop debate on what TRADE WAR and PROTECTIONISM “means” ( we all know what it means ) to focus on outcomes everyone wants – which is each individual nation crying out like eagle babies in a nest for their worms – MORE MONEY FOR ME FOR ME FOR ME.
In this world where cooperation is breaking down – where trust is breaking down into distrust and renegotiations – the geopolitical risk is the market risk to consider. The super high system economic risk we have defined for you as core to the system itself ravaged by:
- A persistent global deflationary death spiral of economic implosions
- A rising DEBT BOMB to fuel growth that is not sustainable globally
- Nonperforming loans in the system passing 200 trillion globally
- Lack of vision to retool the debt crises
- Lack of global G 100 Regulatory Framework to moderate rampant speculator price manipulation of all asset classes creating a global digital casino capitalism.
These five forces must be revised by the most significant leadership re-think of global regulatory frameworks within a G 100 ECONOMIC CONSTITUTIONAL CONVENTION for the world to pass a first GLOBAL REGULATORY FRAMEWORK all G 100 nations sign on to such that the digital world is uniformly and properly under risk moderation without speculator price manipulation capacity.
Until that reframe occurs the system we know today is on final life support and will crash into a financial cardiac arrest – SUPER CRASH – at the time everything looks to be most solid and rosie – surprising and shocking everyone – but my readers.
Berny Dohrmann – STAYING OUT FROM JUST FOR YOU TODAY